Is the Automotive Aftermarket Its Own Worst Enemy?

The automotive aftermarket is in a rough spot. Every quarter, we see the same headlines: profits are down, costs are up, and opportunities are being missed.

Take a look at recent numbers:

• Holley’s gross profit dropped 10.4% last quarter.
• Icahn Automotive saw its EBITDA cut in half.
• Advance Auto Parts, even amid a turnaround effort, is still operating at a loss.

It’s easy to blame external pressures like global competition, rising material costs, or shifts in consumer behavior. But what if the biggest threat isn’t external?

What if we’re standing in our own way?

The signs are everywhere. Rising ad costs and shrinking ROI are putting more pressure on marketing budgets. Low fill rates, driven by poor demand forecasting, are leading to missed sales. Margins are shrinking, EBITA is falling, and persistent job openings are stretching teams too thin.

These aren’t random problems. They’re symptoms of a larger issue: a failure to leverage data to make informed, strategic decisions.

The Problem with Shotgun Strategies

Too many companies are running on outdated strategies, relying on intuition rather than information. The result? Businesses are stuck in a reactive mode, putting out fires instead of building sustainable growth.

Advertising is a clear example. Platforms like Google Ads are designed to maximize their revenue, not yours. Metrics like ROAS might look great in the dashboard, but they don’t tell the full story. You could be spending more and getting diminishing returns, with CPCs rising even when performance doesn’t improve.

Inventory is another area where inefficiencies run rampant. How often do we stock up based on what sold well last year without adjusting for current trends or real-time demand? This leads to overstocking slow movers or running out of high-demand products. Either way, it’s money lost.

Meanwhile, some companies are quietly pulling ahead. O’Reilly and AutoZone didn’t grow their profits by accident. They rely on data to make decisions, executing with precision and efficiency. They’re thriving in the same challenging market where others are struggling.

The Consequences of Inaction

Here’s the reality: every day spent guessing instead of knowing is a day you’re losing ground to competitors. While some businesses adapt and evolve, others are falling further behind.

The cost of doing nothing isn’t just stagnation—it’s decline. Competitors are:

• Capturing market share.
• Delivering better customer experiences.
• Running leaner, more profitable operations.

This isn’t a theoretical problem; it’s already happening. The divide between data-driven companies and those relying on outdated strategies is growing, and the consequences are only becoming more severe.

What Needs to Change

Fixing these issues doesn’t require a complete overhaul—it requires a shift in focus.

First, we need to stop trusting metrics designed to keep us spending. ROAS, CPCs, and other surface-level numbers only tell part of the story. The real question is: are your efforts translating into actual business outcomes like profitability, retention, and efficiency?

Second, businesses need to make data accessible across their teams. Insights can’t live in spreadsheets that only analysts understand. Sales, marketing, and operations teams all need real-time data they can act on.

Third, we need to focus on what works. Use data to identify what’s driving profitability and double down. Eliminate unprofitable promotions, fix inventory gaps, and optimize ad spend.

Finally, we need to embrace a culture of adaptation. The companies that thrive in the coming years will be the ones that adapt quickly, question assumptions, and invest in strategies that position them for long-term success.

A Smarter Future

The automotive aftermarket is at a turning point. We can keep blaming external pressures, or we can take control of the factors within our reach.

At Tromml, we’re helping businesses move from guesswork to action. By turning existing data into actionable insights, we make it easier for teams to focus on what really matters: growing revenue and improving efficiency.

The tools to solve these problems already exist. The question is whether we’re ready to use them.

The future of the aftermarket depends on our ability to adapt. Will we rise to the challenge, or will we let data-driven competitors eat our lunch?

It’s time to decide.